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This paper presents an overview of current models of consumption and investment behavior. First, the stochastic … critical discussion of the Ricardia Equivalence Theorem. Investment behavior is analyzed using a dynamic optimization model of … theory. The model is then used to analyze the interaction of corporate taxes, inflation and investment and also to analyze …
Persistent link: https://www.econbiz.de/10013140034
In this paper I analyze the relationships among investment, q, and cash flow in a tractable stochastic model in which … regressions of investment on q and cash flow. In empirical studies, the estimated cash-flow coefficient is generally positive and …
Persistent link: https://www.econbiz.de/10013015553
convex cost of adjustment. A baby boom increases national saving and investment and thus causes an increase in the price of …. Social Security can potentially affect national saving and investment, though in the long run, it does not affect the price …
Persistent link: https://www.econbiz.de/10012762982
Most of the empirical work on investment is based on the existence of a relation between investment and the expected … demand and technology and examine its relation to investment.We find that variations in this present value series are … value series, although significantly related to investment, still leaves unexplained a large, serially correlated fraction …
Persistent link: https://www.econbiz.de/10013218122
, does not allow separation of the savings decisions of agents from the investment decisions of firms. Investment is … essentially passive: the "one good" assumption leads to a perfectly elastic investment supply; the absence of installation costs … for investment leads to a perfectly elastic investment demand. On the other hand, the standard model of temporary …
Persistent link: https://www.econbiz.de/10013225173
. Alternatively, if the cash-in-advance constraint applies to gross investment as well as consumption, then a permanent increase in …
Persistent link: https://www.econbiz.de/10013236828
volume of investment. Its application to the United States economy and the economies of other major OECD nations suggests …
Persistent link: https://www.econbiz.de/10013237028
The Modified Golden Rule, which relates the rate of return on capital and the growth rate of the capital stock along long-run growth paths that maximize the utility of a representative infinitely-lived consumer, is invariant to the introduction of convex capital adjustment costs. Therefore,...
Persistent link: https://www.econbiz.de/10013248537
With fixed costs of participating in the stock market, consumers with high income will participate in the stock market, but consumers with lower income will not participate. If a fully-funded defined-contribution social security system tries to exploit the equity premium by selling a dollar of...
Persistent link: https://www.econbiz.de/10013245704